This paper develops an overlapping generation model with asymmetric information in the credit market such that the interplay between relationship finance supplied by investors who monitor investment decisions ex-ante and market finance supplied by investors who relay on public information can be...

We present a simple model which establishes a non linear and possibly non monotonic relationship between financial development and economic growth. Applying a threshold regression model to King and Levine™s (1993) data set, we find evidence that is consistent with the main implications...

We present an OLG endogenous growth model in which a reduction in the level of concentration in the banking industry exterts two opposite e.ects on economic growth. On the one hand, it induces economies of specialisation which enhances intermediation e.ciency and thereby eco- nomic growth. On...

We analyze the interaction between bank and market finance in a model where bankers gather information through monitoring and screening.We show that,if a market is established characterized by a disclosure law such that entrepreneurs wishing to raise market finance can credibly disclose their...